US March auto sales fall 40% year over year

HOUSTON (ICIS news)--The US automotive industry received more bad news on Wednesday after statistics released said March sales fell by 40% year over year to 670,303 units.

"The 40% is based on a fairly decent run rate last year," said Dennis Virag, president of Automotive Consulting Group in Ann Arbor, Michigan.

"Sales this time last year were still fairly strong," he said. "If you look at the sales number month to month we've actually seen a slight pick up in sales."

Sales in the third month of 2009 were slightly better than January, when sales dropped 41%, and February when year-over-year figures fell off by 45%.

Faltering US automotive giant General Motors (GM) saw its sales drop 45% in March and Chrysler's March sales compared with a year earlier were down by 39%.

Both automakers have been propped up by billions of US government money since December and are on strict timelines to reduce spending to become profitable in the long term.

Earlier this week, GM was granted 60 days and Chrysler 30 days by the Barack Obama administration to make drastic changes.

The other US auto producer, Ford, which had not relied on government help, had a year-over-year sales decline of 41% in March.

The automobile industry is an important chemical end market, in that each vehicle has nearly $2,700 (€2,025) worth of chemical products or chemical processing value, the American Chemistry Council (ACC) said.

The plunge in car and truck sales has been felt most with automotive parts manufacturers.

Johnson Controls, a US auto-parts maker for GM, Toyota and Honda, announced 10 plant closures in addition to 21 plants it shut last year and 9,300 job cuts, which amounted to 7% of its global workforce.